Source: https://timesofindia.indiatimes.com/business/india-business/link-insurer-ceo-salaries-to-customer-outcomes-irdai/articleshow/131189280.cms

Link insurer CEO salaries to customer outcomes: Irdai

Mayur Shetty / TNN / May 19, 2026, 08:39 IST

Reduce Focus On Profits, Improve Transparency, Curb Misselling’Irdai has sought to link insurance company CEO salaries to customer outcomes, introduce clawbacks and increase transparency. This follows a study by the regulator which showed that CEO salaries were all over the place with key management at times accounting for a big chunk of the wage cost. The regulator also saw the need to reduce the focus on profits and address misselling.In a discussion paper circulated among CEOs, Irdai said there is a need “to move beyond short-term financial performance and focus on sustainable, policyholder-centric outcomes” as existing compensation structures have been “largely tied to revenue, profit, and shareholder returns” and have “failed to capture the long-term value created through positive customer outcomes”.

Irdai has proposed an industry-wide framework that would tie executive pay to a mix of customer, shareholder and regulatory metrics, with customer-related parameters carrying the highest weight. These include measures such as claim settlement timelines, grievance redressal, transparency in product disclosures and overall customer experience. The move is aimed at ensuring that “customer satisfaction, trust, and loyalty” become central to how top management performance is evaluated.

The paper proposes penalties in compensation structures through malus and clawback provisions in cases where insurers fall short on conduct. Pay could be adjusted downward if “customer complaints spike”, “regulatory breaches occur”, or “misselling or unethical practices are identified”, signalling a sharper regulatory focus on accountability at the top.The discussion ties in with the regulators move to curb expenses in selling insurance through commissions and distribution costs to make insurance more affordable. Also there is a wide variation in salaries. In the case of leading life insurers, the standard deviation in CEO pay is as high as Rs 7.9 crore, while for non-life insurers it rises to Rs 11.4 crore. Concerns have also been raised about the “top heavy structure” of insurers. In some cases, management remuneration accounts for as much as 14% of the total salary outgo.The regulator argues that better alignment of pay with customer outcomes could help address these structural issues by improving trust in insurance products and driving wider adoption. The paper said that integrating customer-centric metrics would ensure growth without “compromising customer trust and long-term value”.To improve transparency and demonstrate customercentricity, Irdai has also proposed public disclosure of CEO and KMP remuneration.

END OF REPORT

*************************

Respected Prime Minister and Finance Minister of India,

In the light of the above-mentioned report, please ensure to link L.I.C of India's CEOs salaries to the enormous liabilities that they have created for the Corporation w.e.f. 1st August, 1997 since when the Wage Revision Arrears and Difference in Statutory Retirement Benefits due to the resigning employees have been illegally and unjustly repudiated.

All those CEOs must be punished and their remuneration/retirement emoluments must be confiscated. Even those officials in the Government who ratified the Corporation's unjust and illegal decisions must pay a similar price. Only then will they feel the pinch of having their hard-earned money fraudulently taken away from them! 

We, the long-suffering resigning employees of the Corporation have been bearing the brunt of their unjust and illegal decision to repudiate our arrears and other allied payments, as above-mentioned for nearly three decades.

It's high time that justice is delivered to us in the form of the above-mentioned punishment to them and prompt payment of all our dues with compound interest till date; to all of us.

Thanks in eager anticipation.

Yours sincerely,

The long suffering, resigning ex-employees of L.I.C of India

*********************

Respected Chairman (IRDAI),

Kindly consider linking L.I.C of India's CEOs salaries to the enormous liabilities that they have created for the Corporation w.e.f 1st August, 1997 since when the Wage Revision Arrears and Difference in Statutory Retirement Benefits due to the resigning employees have been illegally and unjustly repudiated.

Why has your institution not done anything for the resigning ex-employees whose arrears have been repudiated illegally since 3 decades? This unjust action is for all the sister concerns of the Corporation and General Insurance companies of the Government too. Surely you are aware of it!

Kindly read the above-mentioned request to the PM and FM of India and do the needful at the earliest.

Thanks in eager anticipation.

Yours sincerely,

The long suffering, resigning ex-employees of L.I.C of India

*********************

Isn't it high time that employers focus on all their employees, past and present who have contributed to the success of their organisations? These profits pay for the CEOs' salaries!

Employees are as important as customers.

Ex-employees are also as important as current employees.

The Supreme Court recognizes this basic fact, but not the Government and IRDAI!